In this interview, Mette Vesterager, Management Consultant, Coach and Founder of Novalead claims that we are still to a very large degree emotionally driven animals. What then does this mean to business within a knowledge driven organisation? Let’s explore:
Mette, you claim that emotion beats reason in B2B selling. Is that a new hippie-trend in business or is there a deeper reason why emotions play a bigger role in business.
The ideal of the rational man is dead. Advances in neuroscience and behavioral economics have revealed that we as human beings are pretty irrational and emotional in how we make decisions. Most of our reasoning is in fact justification because our emotions have already decided for us. Businesses all over the world are using this information to influence buyers’ decisions. Even though we think we are less emotional at work, the fact is that we are not.
So, what do you think of the trend towards a still more fact-based business management. The influence of big data and analytics on strategic and tactical decisions? Does emotions offer a counter-trend?
Data is important, but data depends on how you measure. When you ask people to fill out customer surveys, their answers will depend on the way the questions are asked and in what order. Even when you find there to be a strong correlation between two factors, that does not necessarily imply causality. In the past, data analysis has revealed many strange correlations e.g. the correlation between the winner of the World Series of Baseball and the winner of the presidential election in the US. From 1952 to 1976, whenever the American League won the World Series, a Republican won the presidential election. Conversely, whenever the National League won the World Series, then a Democrat would become the next president. Obviously there is no causality, so we need to be careful about how we interpret the data.
What is the risk if executives don’t take the emotional factor into the equation of business?
They will fall behind competitors. I do not doubt that in a few years from now, the emotional factor will be at the core of strategic, business and organizational development. Addressing emotions has been something restricted to the marketing departments, but emotions will be more at the core of business in the future. There has been a trend to remove emotions from the equation—to make everything objective and rational—but we cannot remove emotions from real life. And how boring would life be, if we could do that! Instead, we need to understand the emotional factor.
You are a mathematician (former Phd. candidate) and a philosopher (BSc.) at the same time. Which will win the business battle – sense or sensibility?
We need both. You could say that I have a background in both sense and sensibility, and I have learned throughout my business career that it is both possible and vital to combine these approaches.
Overall, what is challenging executives today, and how can technology help?
The speed of change caused by globalization and technological development is the key challenge for executives today. Progress in these areas coincidentally leads to increasing complexity and information overload. Technology can help to analyse all this data, but technology cannot stand alone. We need to know more about the psychology of decision-making in order to understand the inherent biases we have. To assume that technology has no bias is simply wrong! Guess who built that technology?
Do you believe in the concept of thought leadership as a mean to foster more meaningful and intelligent conversations and thus drive business?
Thought leadership is becoming increasingly important. Today, you have the “one-in-three problem” as a supplier. Customers typically learn on their own through digital channels. Using a simple search they can easily identify the three suppliers in a field whose products can deliver business value and are acceptable options. This inevitably leads to a price competition where customers ultimately choose the supplier who is willing to offer the lowest price. In order to beat price competition, you need to offer something more to your client besides a product or information. Beyond your initial offer, you need to share with your client your knowledge about the market, future trends and implementation and organisational drivers. Your client needs to know and trust that they can depend on you as a source of knowledge, and that is why thought leadership is a key driver in business today.